The World Benchmarking Alliance has circulated its Corporate Human Rights Benchmark Rights Benchmark 2020. It is worth considering for its conclusions, for its data and for the form of its engagement, even if one quibbles over the choices made to arrive at the benchmarks. The benchmarking covered what they determined to be the 230 most influential companies in agricultural products, apparel, automotive manufacturing, extractives and ICT manufacturing.
The CHRB is part of WBA, which seeks to generate a movement around increasing the private sector’s impact towards a sustainable future for all. The CHRB produces benchmarks that rank global companies on their human rights performance.
WBA is developing multiple benchmarks that will eventually measure and rank 2,000 keystone companies – companies that have been identified as most influential in contributing to the SDGs across seven critical systems transformations. These are decarbonisation and energy, food and agriculture, circular, digital, urban, financial and social. (HERE)
Civil Society influencers have focused on the auto sector findings and generally on the weakness of corporate efforts to embed human rights due diligence procedures constructed against the ideal benchmarked (see, e.g., here). And the Report will prove useful, especially in the European Union where forms of mandatory human rights due diligence systems are being considered (Report p. 38).
The CHRB results suggest that, without government regulation, only a minority of companies will act to meet their human rights responsibil- ities, and improvements will remain too slow. We therefore encourage governments and regional bodies to introduce more and tougher mandatory measures and bring consistency to expectations across jurisdictions. These measures should be detailed and include guidance for companies on how to fulfil their obligations.
It is important to note as well, even as the benchmark results take on a life of their own a caution contained in the Report (p.43).
WBA would like to emphasise that the results contained in this bench- mark will always be a proxy for good human rights management and not an absolute measure of performance. This is because, while extensive work is being undertaken to understand and value respect for human rights, there are no agreed fundamental units of measurement for human rights. As such, the results provide a subjective assessment at a certain point in time. Therefore, a score of 0 on an individual indicator does not necessarily mean that bad practices are present or that there is no company action on the issue. Rather, it indicates that we have been unable to identify the required information in public documentation.
The results show that there has been progress on previous years. A number of companies are meeting the fundamental expectations of the United Nations Guiding Principles on Business and Human Rights (UNGPs), with strong commitments and rigorous procedures in place. However, two significant challenges have emerged.
The first is that only a minority of companies demonstrate the willingness and commitment to take human rights seriously. The second challenge is arguably more pernicious and relates to the disconnect between commitments and processes on the one hand and actual performance and results on the other. If we are to achieve the SDGs by 2030, we need to ensure that strong commitments and management systems deliver their intended effects. Additionally, we need all companies to participate in this effort and to place people and planet above the pursuit of profit at all cost.
The automotive sector is the worst performing ever in the CHRB
The average score for automotive companies is 12%, the lowest score ever for a CHRB-benchmarked sector. Two thirds of the companies scored 0 across all human rights due diligence indicators. These poor results suggest implementation of the UNGPs is weak across the sector.
Key findingKey finding
Too many companies are failing to meet investor expectations on human rights due diligence
In March 176 international investors sent a letter to the 95 companies that failed to score any points on the human rights due diligence indicators, calling for urgent improvement. Of those 95 companies, 79 continue to score 0 on human rights due diligence.
A just transition is undermined by a disconnect between human rights and climate issues
The automotive companies included in the 2020 CHRB were also assessed by the Climate and Energy Benchmark. When comparing both assessments, almost no correlation could be found between a company’s relative performance on either benchmark. In the coming decades, emissions-intensive sectors, such as automotive, face the major challenge of shifting to a net zero-carbon economy while upholding the central promise of the SDGs to leave no one behind.